In 2004, the Government of Nigeria revamped their formal pension system to include a retirement savings account (RSA) for all pensioners. An independent monitoring agency was established to ensure for a strong accountability mechanism.

In 1996, poverty rates in Nigeria had reached an alarmingly high rate of 65.6 percent. It had quickly become clear that transformational policies needed to be implemented. Prior to 2004, Nigeria relied on a poorly functioning pension system that lacked transparency. The pension reform scheme brought about three vital changes to the system: one, individual retirement savings accounts; two, individual operational authorities assigned to watch over pension accounts; and three, a general monitoring agency responsible for the functioning of the system as a whole.